Australian, NZ Dollars Lower On Fed Policy Concerns
May 06 2022 - 1:21AM
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The Australian and NZ dollars fell against their major
counterparts in the European session on Friday, weighed by concerns
over aggressive interest rate hikes by the U.S. Federal Reserve and
its impact on economic growth.
Investors focus on the U.S. Labor Department's nonfarm payrolls
data due later today for more clues on the strength of the labor
market and its impact on monetary policy.
European markets fell, tracking a sell-off in Asia and Wall
Street, as investors fear that the Fed and some other major central
banks would pursue a more aggressive policy tightening to curb
inflation, which could derail economic growth.
Comments from Chinese President Xi Jinping that the government
would "resolutely adhere to" the zero-Covid policy further dampened
risk sentiment.
Russia's war on Ukraine, high oil prices and China's virus
lockdowns also added to worries.
The aussie weakened to 3-day lows of 0.7064 against the
greenback and 92.15 against the yen, off its early highs of 0.7132
and 92.99, respectively. The next possible support for the aussie
is seen around 0.68 against the greenback and 90.00 against the
yen.
The aussie reversed from its prior highs of 1.4790 against the
euro and 0.9144 against the loonie and touched 3-day lows of 1.4902
and 0.9084, respectively. The aussie is poised to challenge support
around 1.51 against the euro and 0.88 against the loonie.
The aussie fell to a session's low of 1.1039 against the kiwi,
after rising to 1.1080 earlier in the session. If the aussie falls
further, it is likely to test support around the 1.075 region.
The kiwi dropped to 0.6394 against the greenback and 83.43
against the yen, down from its prior highs of 0.6442 and 84.00,
respectively. The kiwi may locate support around 0.62 against the
greenback and 82.00 against the yen.
The kiwi dipped to 1.6463 against the euro, its weakest level
since March 2. On the downside, 1.66 is possibly seen as its next
support level.
Looking ahead, U.S. and Canadian jobs data for April, U.S.
consumer credit for March and Canada Ivey PMI for April will be
published in the New York session.
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